Buying a home in New Jersey is an exciting milestone—but it can also be a bit daunting, especially if you’re unfamiliar with the local real estate process. Whether you’re a first-time homebuyer or relocating from another state, understanding how things work in the Garden State can save you time, stress, and money.
Here are seven essential things to know before diving into the New Jersey housing market:
1. Property Taxes in New Jersey Are Among the Highest in the U.S.
New Jersey is well known for its high property taxes, which consistently rank among the top in the country. These taxes can significantly impact your monthly housing costs, so it’s crucial to research tax rates in the towns you’re considering.
- Tip: Property tax rates can vary dramatically from one municipality to another. For example, towns with strong school systems or commuter access often have higher taxes.
- Action Step: Ask your real estate agent to provide recent tax records for homes you’re interested in, and plug these figures into your mortgage calculator.
2. Attorney Review Is a Standard Part of the Process
One unique aspect of buying real estate in New Jersey is the three-day attorney review period that begins after both buyer and seller sign the initial contract.
- During this time, either party can cancel the contract for any reason without penalty.
- It’s also when attorneys can negotiate changes or add riders to protect your interests.
Working with a real estate attorney is not just smart—it’s expected. A good lawyer will guide you through potential red flags and help you avoid common pitfalls.
3. Commuter Towns Come at a Premium
Planning to work in New York City or Philadelphia? Many buyers choose to live in commuter towns with easy access to transit lines—especially NJ Transit train stations or bus routes.
- Popular towns like Montclair, Hoboken, Summit, and Princeton often see bidding wars due to their ideal location and urban/suburban blend.
- Expect higher home prices and increased competition in these areas, particularly for properties close to walkable downtowns or direct train service.
4. Flood Zones and Environmental Risks Are Common
Due to New Jersey’s geography—with its rivers, bays, and extensive coastline—flood zones are a serious consideration.
- Always consult FEMA flood maps before making an offer.
- Some homes, even those far from the shore, may require flood insurance, which can add hundreds to your monthly expenses.
Additionally, New Jersey has a history of underground oil tanks, especially in homes built before the 1970s. A tank sweep is strongly recommended during inspections to avoid expensive future remediation.
5. School Districts Heavily Influence Home Values
Even if you don’t have children, the quality of local schools plays a major role in property values and resale potential.
- Homes in top-rated districts typically hold their value better and sell faster.
- School ratings are public, so do your research using tools like GreatSchools or Niche.com.
Pro tip: A home in a desirable district can be a long-term investment even if you’re not currently planning to use the school system.
6. Home Inspections Go Beyond the Basics
In New Jersey, home inspections are detailed and often include specialized checks, especially for older properties.
Here’s what’s typically covered:
- General inspection for structural issues, electrical, plumbing, and HVAC.
- Radon testing, which is essential in many NJ areas.
- Termite inspections, as wood-destroying insects are common.
- Tank sweeps to check for abandoned underground oil tanks.
Budget for inspections and consider using the results to negotiate repairs or credits before closing.
7. First-Time Homebuyer Programs Can Save You Thousands
New Jersey offers several first-time homebuyer programs through the New Jersey Housing and Mortgage Finance Agency (NJHMFA), including:
- Down payment assistance up to $15,000.
- Competitive mortgage rates for qualified buyers.
- Tax credit programs that can reduce your federal income tax liability.
Be sure to ask your lender about state and local grants or low-interest mortgage options. These programs can be a game-changer if you’re working with a tight budget.
Final Thoughts
Buying a home in New Jersey involves unique processes, legal steps, and local considerations. But with the right preparation—and the right professionals by your side—it can be a smooth and rewarding experience.
Partner with a local real estate agent who understands the nuances of NJ markets, from taxes and transit to schools and environmental risks. Being informed is your best advantage in making a confident, smart investment in your future home.